Access to finance and job growth: firm-level evidence across developing countries

Meghana Ayyagari, Pedro Juarros (), Maria Martinez Peria and Sandeep Singh

No 7604, Policy Research Working Paper Series from The World Bank

Abstract: This paper investigates the effect of access to finance on job growth in 50,000 firms across 70 developing countries. Using the introduction of credit bureaus as an exogenous shock to the supply of credit, the paper finds that increased access to finance results in higher employment growth, especially among micro, small, and medium enterprises. The results are robust to using firm fixed effects, industry measures of external finance dependence, and propensity score matching in a complementary panel data set of more than four million firms in 29 developing countries. The findings have implications for policy interventions targeted to produce job growth in micro, small, and medium enterprises.

Keywords: Economic Theory&Research; Industrial Economics; Economic Growth (search for similar items in EconPapers)
Date: 2016-03-16
New Economics Papers: this item is included in nep-ent and nep-sbm
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Citations: View citations in EconPapers (20)

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